Yields
Some Stablecoin Farms
Stablecoin yields are still surprisingly high.
I spent some time digging into a few of the larger opportunities and found that they’re earning yield in very different ways. Some are taking Treasury exposure, some are running basis trades, and some are relying on market-neutral trading strategies.
Here are 3 stablecoin products paying roughly 8-12% APY and the tradeoffs behind each:
#1 – Fluid Lite Vault (Ethereum) ~8% to 9% APY
Deposit USDC and it earns off looped yield-bearing stables. Lowest risk of the three, and the one I worry about least.
About 70% of it sits in sUSDai, which is the part to actually pay attention to. That’s earning from US Treasuries plus interest from AI companies borrowing to buy GPUs. Yeah, you read that right. The whole yield lives or dies on AI demand holding up.
There’s also a 0.05% withdrawal fee, and during that KelpDAO liquidity mess, instant withdrawals just stopped working, fee or not.
#2 – mHYPER (Ethereum) ~9.5% to 12% APY
Run by Hyperithm, a licensed shop out of Tokyo and Seoul. Yield comes from looping stables, basis trades, and lending.
The book’s smaller here (~$120M), so it’s less battle-tested than the big curators like Gauntlet. And it did get caught in the Stream Finance blowup. The team pulled the bad positions and isolated the vaults, but I’ll be honest, that fix is recent enough that I’m still watching it closely.
Use the normal redemption (1 to 3 days) to skip the 0.5% instant fee. And heads up, there’s a 20% performance fee on the yield too.
#3 – sUSDu by Unitas (Solana or BNB) ~9.5% to 10% APY
This one’s the most transparent of the three. Proof of reserves across Primus, DeFiLlama, and Dune, weekly audits, backing sitting above 100%. If transparency is what helps you sleep, it’s this one.
Yield comes from a basket of market-neutral strategies, funding rates, lending, trading fees, and JLP capture. Basically, a synthetic dollar.
The catch here is liquidity. There’s a 7-day cooldown after you unstake, and your funds stop earning the whole time.
So only park money here, you can leave alone for a week or two.
None of this is set and forget, though. Yields drift, withdrawal terms can bite at the worst possible moment, and liquidity disappears fast when things get hairy (remember KelpDAO?).
That 8-12% is the pay for everything I just walked you through.
Sponsored by Stacks
The Suits Just Entered Bitcoin DeFi
For years, Bitcoin DeFi was a degen-only game. Institutions sat it out, holding BTC like a trophy and earning nothing on it. That just changed.
Quick 80/20: Stacks is the Bitcoin L2 for smart contracts and DeFi, secured by Bitcoin itself. Its sBTC is a 1:1 Bitcoin-backed asset you can lend, borrow, and put to work.
Fireblocks is the custody infrastructure that 2,400+ institutions already trust to hold their assets.
Now the two have connected. Stacks is live on Fireblocks, so those 2,400+ clients can reach Bitcoin DeFi straight from custody: borrow against BTC on Zest, trade on Bitflow, and mint synthetic dollars on Hermetica.
Why does it matter? This is the on-ramp that turns idle institutional Bitcoin into a productive asset, with minimal added trust assumptions. This summer, there’ll be native Bitcoin staking as well!
The trenches built DeFi. Now the institutions are joining the party.
News
EF is Broke. How to Fund Ethereum Development?
Researchers have been walking out of the Ethereum Foundation for months.
Tomasz Stańczak, the ex-EF executive director everyone hoped would take ETH to Valhalla, left in February. 8+ senior departures followed this year. Co-executive director Hsiao-Wei Wang resigned this month.
Everyone had a theory. Vitalik’s secret control. EF corporate politics. Take your pick.
Then last Thursday, @trent_vanepps pointed at one concrete problem underneath all of it: an “impending protocol funding crisis.”
There is a risk we will enter a slow-burning funding crisis within the next 3-9 months.
Here’s the reason. The EF is cutting its budget by 40% this year, a big reduction meant to keep the organization sustainable over the medium term.
Good for the EF. Bad for the client developers who were relying on that money.
An In-Protocol Tax?
On June 21st, @clesaege proposed a fix.
Quick 80/20 on the mechanism: if more than 50% of validators vote to redirect a slice of their staking rewards (capped at 10%), it becomes mandatory for everyone, including the ones who voted no. They also vote on where the money goes, but it’s collective. One winning recipient list gets all the money.
TLDR: every validator pays a tax to fund Ethereum development.
The logic (sorta) holds up.
Ethereum has a public goods problem. Clients, research, and security all benefit everyone, but no single player wants to foot the bill for the whole thing. So it stays chronically underfunded.
And validators are arguably the right ones to fix it. They’ve got the most skin in the game. More development > more activity > burns more ETH > pumps $ETH, which they hold. Funding Ethereum is really just validators paying themselves.
The catch is that nobody pays voluntarily, because whoever pays eats the disadvantage. It’s the free-rider problem. A mandatory trigger solves that. Once a majority agrees, everyone chips in, so there’s no penalty for being the good guy. And with the rate capped at 10%, the worst case is bounded from day one.
Now the other side.
Firstly, this proposal trades Ethereum’s monetary premium for developer funding.
ETH doesn’t trade where it does because of its cash flows. It trades on a monetary premium, the market pricing in a future where it’s a global store of value. That premium dwarfs whatever fee potential ETH has.
Force the distribution of 10% of all new ETH to a committee (Protocol Guild, or some mechanism like it), even through validator voting, and you take a real bite out of that premium. Bad trade.
The second argument against: capture.
Staking is already concentrated. “51% of validators decide” really means a handful of big operators like Lido and Coinbase decide. Nothing stops that bloc from voting rewards toward addresses it happens to like.
Play it forward and you get a political class inside Ethereum that lives off this funding. Ethereum already catches heat for being a politically dysfunctional system full of ivory tower types. Getting funded could come down to bowing to that class.
There are counter-arguments to the counter-arguments, too. If you want details, click here. Here, I’ll spare you the weeds.
I like another solution. @fede_intern, whose company is also building an ETH client, says forget the tax. Market participants in the Ethereum ecosystem will fund development themselves.
Remember, in the tax proposal, one winning list of recipients (with committees like Protocol Guild) collects the funds and decides where they go. Fede’s bet is that market-funded development beats committee-directed development.
Through that lens, the in-protocol-funding proposal looks like a way for Ethereum’s current “inner circle” to keep holding the purse strings.
But will the market actually fund Ethereum development?
The Eth labs Announcement
Remember that exodus of senior talent from the EF? Most of them just banded together into a new non-profit called Eth Labs.
That makes it the third Ethereum foundation (fourth if you count Etherealize, since the second was @ethcforg ). So what actually makes this one different?
First, it’s run by ex-EF people. The ones who’ve been building Ethereum for the past decade.
More importantly, it’s backed by Ethereum giants: Bitmine, Sharplink, Joe Lubin, Dragonfly, Electric Capital, the major L2s (megaETH, Base, Offchain, OP, and more), Justin Drake, Etherealize, Across, Flashbots, Lambda Class, and others.
The names that matter most are the two anchor funders: Bitmine and Sharplink.
They’re the top two ETH Treasury companies, and they have a vested interest in keeping ETH pumping.
So yes, there are market participants ready to fund Ethereum development.
But it does mean Ethereum develops the way the market needs it to, not necessarily the way traditional Ethereum engineers would want.
And that might be a good thing.
What’s Next?
I don’t see a realistic path to Ethereum adding in-protocol development funding. I think it’s a bad move, and more to the point, it cuts so hard against ETH’s culture that I doubt most validators ever upgrade to that hard fork.
Second, the multiple-foundations approach is the better outcome.
There’s a real split in how people see Ethereum’s future. Read Vitalik’s own breakdown of the EF’s problem here.
He argues Ethereum isn’t enough of a “sanctuary technology.” The other camp says there isn’t enough “BD and capitalist” energy in Ethereum development.
Same situation, opposite conclusions. No single organization can run on both at once. Which is exactly why more independent organizations, with independent funding, is good for Ethereum.
The two-foundation setup gets you the best of both. The EF keeps optimizing for CROPS. Eth Labs, funded by the ETH Treasury companies, optimizes to pump $ETH.
It’s all talk for now. The execution is the part that has to show up.
🚀 DeFi Catalysts
THORChain is fully back online after more than a month offline. They went offline after the $10.7M hack of the chain.
Cap Money will officially launch its token $CAP tomorrow. Its token auction ran on Uniswap’s Continuous Clearing Auction (CCA).
Base is launching a new native token standard called B20. It’ll be native precompile tokens with built-in compliance.
Aztec Network‘s L2 has become a fully permissionless chain that meets all the stage-2 criteria for layer 2s.
Polymarket can now be accessed from Telegram through a TON-native dApp, Predict. It’s powered by The Open Platform.
Ripple has secured its preliminary Crypto Asset Service Provider (CASP) license in Luxembourg. It sets up the full rollout of Ripple Payments in Europe.
Zama‘s Steakhouse Confidential Prime USDC Vault has gone live on Morpho. It enables a private yield opportunity on USDC.
Curvance launched a Lending Optimizer Vault on Monad. It automatically reallocates deposits across lending markets to maximize AUSD yield.
Bittensor‘s co-founder acknowledges that the protocol is not yet fully decentralized to avoid premature ossification. Full decentralization is targeted within the next 18 months.
Polymarket is accused of paying creators to post staged bets and fake winnings, while using overseas “clippers” to make the content go viral among U.S. users despite its U.S. trading ban.
📰 Industry News
Andre Cronje, Michael Kong, and David Richardson resigned from the Sonic Labs board. Matt Visser steps in as the new Chief Executive Officer.
Kraken added onchain trading to their app. Their customers can now trade 2,500+ Solana-based tokens directly from the Kraken app.
Coinbase has secured its Markets in Crypto Assets (MiCA) licence from Luxembourg. With it, they can offer a full suite of crypto products to all 27 EU member states.
Axelar Network reported a $4.67 million exploit affecting assets bridged from Axelar to Secret Network via the Secret-side ICS-20 smart contract.
Base engineering team introduced “Beryl”, their second network upgrade. It’s now in the testnet.
Taiko confirmed a critical compromise of its chain state verification mechanism, rendering all bridge security assumptions unreliable.
Helius released the balance-at-endpoint feature. It’ll give you a wallet’s balance at any point in time.
🐦⬛ X Hits
- A Solana bull case.
- Evaluating crypto assets as SoV.
- Deep dive into decentralized inference.
- The art of arbitrage: a note for crypto founders.
- What should Strategy do?
😂 Meme
Until next time,
Edgy
Today’s email was written by Edgy and Yayya.
DISCLAIMER: I’m NOT a financial advisor. This content is for education and information purposes only. Crypto and DeFi are risky and speculative. Please do your research before investing.
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